The schools secretary, Ed Balls, today ordered a review to crack down on racism and British National party activity in schools as he called on the Labour party to embark on the general election "fight of our lives".

Speaking to the Labour party conference in Brighton, Balls revealed three new policies including the plan for a review by the former chief inspector of schools, Maurice Smith, to "keep racism and BNP activity out of all our schools". It will consider whether to ban BNP members from becoming teachers.

Balls also set out a new "behaviour challenge" to clamp down on poorly behaved children and their parents, and announced that the army of 183,000 teaching assistants in schools as well as cooks, cleaners and caretakers would get a new professional body funded to improve training and the recognition of their work.

It comes after Balls rejected recommendations to cut back spending on non-teaching staff to save money in the recession.

He acknowledged the difficulties the party is facing in the run-up to the general election. "It is going to be a hard fight. Yes, we are the underdogs. But in the coming months as we make the phone calls, deliver the leaflets and knock on doors, remember what's at stake," he said listing Labour policies the Tories have said they would cut, including children's centres and school refurbishment projects.

"This is the most important election for a generation. It is going to be a hard fight, let us win it for the future of our country."

He sought to depict the plans of his Conservative shadow, Michael Gove, as exclusive and elitist, condemning an announcement to exclude vocational qualifications from league tables in which so-called "soft" subjects score less than academic A-levels and GCSEs.

"Instead of ending the damaging old divide between first class academic qualifications for some and vocational learning for the rest, he wants to turn back the clock and entrench that divide.

"Conference, this is the choice: between a Conservative party determined to preserve excellence for those who have it and a Labour government committed to open up excellence and opportunity for all."

His announcement of on the review of provisions to tackle racism in schools follows a campaign by teachers to convince the General Teaching Council for England to ban members of the BNP from working in schools and a series of rows over BNP members seeking to become school governors of schools.

Smith has been asked to look at existing safeguards, whether there is a case for further measures to "maintain trust in the teaching profession and protect children and young people from indoctrination and discrimination" and wether to bar BNP members from working in schools.

Chris Keates, general secretary of the NASUWT teaching union, said: "The NASUWT has campaigned tirelessly for a number of years to have the teachers' contract changed to prevent the BNP from working as teachers. Today's announcement is a major step forward towards that goal.

"Previous secretaries of state have been sympathetic but now we have a clear commitment to take action on this issue. All right-minded people understand that an agenda of hatred, bigotry and intolerance has no place in education."